Productivity Commission to focus regulatory regime review on where markets have failed
By Paul McBeth
Aug. 28 (BusinessDesk) - The Productivity Commission has released an issues paper outlining a raft of questions it wants answers to as it probes the country’s regulatory regime, and will have a keen eye on regulation where markets have failed.
The commission has been tasked with looking across New Zealand’s various regulatory regimes with a view to come up with ways to better design and implement future iterations. The body will look at how regulations are intended to operate and how that’s translated into practice, it said in an issues paper on the review.
“The commission will focus on the regulation that is implemented where the operation of markets fails to produce behaviour or outcomes that are aligned with the public interest,” the paper said.
Those areas are traditionally where there is monopoly or anti-competitive behaviour, a lack of shared information, externalities where the full costs and benefits of a private party aren’t fully accounted for when they spill over to third parties, and public goods.
“Because regulation involves the exercise of coercive legal powers, the outcomes of regulation should be justifiable on the grounds of the public benefit,” the paper said.
The inquiry’s issues paper is open to submissions until Oct. 25, with a draft report scheduled for February and a final report slated for June next year.
Among the questions the commission is seeking feedback on are examples of where regulations have worked and where they haven’t, what sectors lend themselves to regulatory regimes, whether funding is appropriate, and which regimes have unclear objectives and what have been the impact of that.
The commission also wants suggestions on the challenges to adopting risk-based approaches to New Zealand regulation, which has become a prominent feature of the landscape in areas, such as border security, financial services regulation, and food safety, the paper said.